Impermanent loss is usually explained as "what happens when prices move apart in a liquidity pool." That's true but incomplete — the number only cares about the rapporto between the two assets' price changes, never which one moved, never the absolute size of either move on its own. Get that, and a lot of confusing LP math stops being confusing.
Providing liquidity has a hidden cost. Trading doesn't have to.Fai trading su Bybit: liquidità elevata, commissioni basse, bonus di benvenuto fino a $ 30.000.Apri il conto Bybit →Put $500 of ETH and $500 of USDC into a 50/50 constant-product pool (Uniswap V2-style). The pool's smart contract automatically rebalances the two sides as the price moves, so that their dollar value stays equal — which means every time ETH's price changes, the pool sells some of whichever side went up and buys more of whichever went down, relative to just holding.
Impermanent loss is the gap that rebalancing creates between what the pool position is worth E what the same two assets would be worth sitting untouched in a wallet. It is a comparison against HODLing — an opportunity cost — not a loss of principal. The calcolatore di perdite impermanenti on this site runs this comparison directly from two input percentages: how much each pooled asset moved.
For a full-range 50/50 pool, the formula reduces to one variable — the price ratio r between the two assets' end and start prices:
IL(r) = 2·√r / (1 + r) − 1
Take a $1,000 position, split $500/$500 into Asset A and Asset B. Asset A stays flat (0%), Asset B doubles (+100%). Plugging into the pool math:
| Strategia | End value | Ritorno |
|---|---|---|
| Holding both assets untouched | $1,500.00 | +50.00% |
| 50/50 liquidity pool position | $1,414.21 | +41.40% |
| Impermanent loss (pool vs. hold) | −5,72% | |
Notice what happened: the LP position is up 41.4% in absolute dollar terms — nobody lost money here. It still shows a -5.72% impermanent loss, because it gained less than simply holding would have. This is the single most common source of confusion with IL: the sign of your dollar P&L and the sign of your impermanent loss are two different questions.
Now compare that same (0%, +100%) scenario to a very different-looking one: Asset A drops 25%, Asset B rises 50% — (-25%, +50%).
| Scenario | Hold value | Pool value | Perdita permanente |
|---|---|---|---|
| (0%, +100%) | $1,500.00 | $1,414.21 | −5,72% |
| (−25%, +50%) | $1,125.00 | $1,060.66 | −5,72% |
Identical impermanent loss, from two scenarios that look nothing alike — because in both cases Asset B ends up exactly 2x the price of Asset A relative to where they started. IL(r) depends only on that ratio r. Flip it around — ratio 0.5 instead of 2 — and you get exactly the same -5.72%, because the formula is symmetric: IL(r) = IL(1/r). It doesn't matter which asset "won"; a 2x divergence in either direction costs the same.
It also means equal moves cancel out completely: (+50%, +50%) gives r = 1 and IL = 0%, no matter how large that equal move is, because the two sides of the pool never diverge from each other.
Because IL is a pure function of the ratio r, you can tabulate it once and reuse it for any pair of assets — this is the table most DeFi guides cite, worked here from the formula above rather than copied:
| Price ratio (r) | Perdita permanente |
|---|---|
| 1.25x | −0.62% |
| 1.50x | −2,02% |
| 2.00x | −5,72% |
| 3.00x | −13,40% |
| 4.00x | −20.00% |
| 5.00x | −25,46% |
IL grows faster than the ratio does — doubling the divergence from 2x to 4x more than triples the loss (−5.72% → −20.00%). This table applies specifically to full-range 50/50 constant-product pools. Weighted pools (e.g. 80/20) and concentrated liquidity ranges change the formula — concentrating capital into a narrower range amplifies IL per dollar deposited, which the concentrated liquidity (Uniswap V3) range calculator models separately.
If the price ratio fully reverts to 1 — Asset B's price relative to Asset A goes back to exactly where it started — the impermanent loss goes back to exactly 0%, as if the divergence never happened. That round trip is what makes it "impermanent" rather than a fixed cost.
It converts into a permanent, realized loss the moment liquidity is withdrawn while the ratio is still away from 1 — the gap gets locked in at whatever it happens to be at that instant. Trading fees earned while providing liquidity exist specifically to compensate for this risk; whether a position comes out ahead overall depends on whether accumulated fee income outweighs the IL at the time of withdrawal, which is a function of pool volume, not something IL math alone can answer. A closely related idea — loss-versus-rebalancing (LVR) — isolates just the portion of this cost caused by arbitrageurs trading against the pool's stale price in continuous time; see the LVR calculator for that version of the question.
Impermanent loss (IL) is the gap between what your liquidity-pool position is worth and what the same two assets would be worth if you had just held them in a wallet instead. It is an opportunity cost measured against HODLing, not a loss of principal — a 50/50 ETH/USDC pool can go up in dollar value and still show a negative impermanent loss number, because holding would have gone up even more.
Yes. In a worked example where one asset stays flat (0%) and the other doubles (+100%), a $1,000 50/50 pool position rises to $1,414.21 (+41.4%) while simply holding the two assets would have risen to $1,500 (+50%). The LP position gained money in absolute terms but still shows -5.72% impermanent loss relative to holding.
Only the price ratio between the two assets matters, not which one moved or the absolute size of each move. A (0%, +100%) scenario and a (-25%, +50%) scenario produce the identical -5.72% impermanent loss, because in both cases the second asset ends up exactly 2x the price of the first relative to the start. Scale both assets by the same percentage, like (+50%, +50%), and impermanent loss is exactly 0% regardless of how large that equal move is.
It is called impermanent because if the price ratio fully reverts to where it started, the loss disappears completely with zero net effect. It becomes permanent only at the moment you withdraw liquidity while the ratio is still away from 1:1 — at that instant the paper gap is locked in as a realized loss. Trading fees earned while providing liquidity are the mechanism meant to offset this cost over time; whether they actually do depends on pool volume and how long the price ratio stays diverged.
⚠️ Educational only — not financial advice. Providing liquidity can lose principal relative to holding, and smart-contract risk applies on top of impermanent loss.